FirstEnergy waives fee for some customers

One-time surcharge now only applies to businesses, not residential customers

May 2, 2014

Residential customers of FirstEnergy Solutions will not be hit with a one-time surcharge on their electric bills.

Officials of FirstEnergy Solutions, a subsidiary of FirstEnergy Corp., said the recently proposed surcharge associated with January's polar vortex is being waived for residential customers. The one time $5 to $15 per customer surcharge would have appeared on customers' May, June or July bills.

But business customers still will be assessed a surcharge.

"It was a very difficult winter, particularly for residential customers, and hopefully waiving the surcharge will make it somewhat easier," said FES President Donald R. Schneider in a statement. "Even though our contracts allow us to pass through surcharges, we have decided we won't seek reimbursement from residential customers for the added costs.

During the January polar vortex, PJM Interconnection - the regional transmission organization that coordinates wholesale electricity in the region - initiated emergency procedures that included the purchase of reserve electric generation to keep the electric system operational.

Costs associated with the purchase were invoiced by PJM to all retail suppliers serving customers throughout the region, and certain contracts allowed those costs to be passed through to customers at the discretion of the supplier.

FES spokeswoman Diane Francis would not reveal how much money the decision will cost the company.

"We will absorb the cost," Francis said.

FES will continue with its plan to add a surcharge to the bills of its business customers.

"The cost for each business will vary because of the size of the business. For most small businesses, it will be around $30," Francis said.

The Utility Workers Union of America hailed the decision not to extract the "polar vortex surcharge" from its residential customers.

"FirstEnergy's reversal of its scheme to charge extra fees for fixed-price customers is a victory for consumers," said Bob Whalen, president of UWUA System Local 102 in a statement. "Even so, the fact that the company is still trying to collect these charges from business customers tells us that FirstEnergy has the same contempt for consumers that it has shown for hourly utility workers."

The UWUA filed a petition with the Pennsylvania Public Utility Commission earlier this month challenging the surcharges for fixed-price customers, arguing that "fixed" should mean "fixed." FirstEnergy abandoned its surcharge scheme for residential consumers two weeks later.

Francis said the filing had nothing to do with the decision; it was made after listening to customers.

"Businesses have been shopping for suppliers for a long time. Residential customers just started shopping for their suppliers. The decision was more of listening to our residential customers and their comfort with shopping for suppliers. Customer satisfaction is something we take very seriously," Francis said.

The PUC is pleased with FES' decision.

"We don't have any jurisdiction over the charges, but we are pleased they responded to the consumers needs and not to burden them with